MODULE 1= THE ENTREPRENEURSHIP – A PERSPECTIVE

Concepts of Entrepreneurship development

Meaning
Entrepreneurship development is basically the process of improving the skill set as well as the knowledge
of the entrepreneurs. This can be done through various methods such as classroom sessions or training
programmes specially designed to increase the entrepreneurial acumen.
In other words this term could be the process of enhancing the capacity to develop, manage and organize a
business venture while keeping in mind the risks associated with it.

Process of Entrepreneurship Development

 Clear View of the Objective of the Program

Before you get into training the prospective entrepreneurs, it is very important to have a clear objective and
plan in mind about what the program is going to encompass.

Without a proper plan and direction, the training would not yield the desired results. This would lead to a
loss of time, money, effort and most of all, valuable potential.

 Selecting the Potential Targets

It is important to select the potential targets who are willing to enhance their skills and who can be
identified as the people who have some amount of business acumen. These can be further divided into two
categories- the educated target audience and the uneducated target audience.

Educated audience refers to the target people who have a decent educational background and want to be
entrepreneurs. These people have the motivation to put their education to use by starting a venture and
working for themselves.

Uneducated audience refers to the people who are not as privileged as others in terms of education about
the market and have the potential to become entrepreneurs. These people are constantly looking for
alternative ways to earn money and support their families. Therefore they are highly motivated and, given
the right training and direction, can prove to be exceptional entrepreneurs.

 Identifying Local Talents and Markets

The process of entrepreneurship development program can be seen as most effective and efficient when it is
applied in the local markets and on the local entrepreneurs who know about it. These people understand
and absorb the knowledge way more quickly and can apply it in the current scenario because of which the
results of the program can be seen more quickly and effectively.

 Choosing the Right Location

In India unfortunately, these programs can only be launched where support institutions and resources are
available, but ideally, these programmes should be planned and launched in the areas where most people
are interested and willing to take advantages of these programmes so that this opportunity can be used most
effectively and there is no loss of resources.

 Tying up with Institutions

A lot of times these programmes involve tying up with various institutions like universities, NGO and some
private institutions. This is done to give a real-world experience to assist the program and give the people
some idea of the situations in the real world.

 Develop the Entrepreneurship Program as Needed

People and their skill sets are different and develop over time. Thus, it is very important to keep developing
the programs to suit the needs of the people enrolled in it. Moreover, the focus must be on harnessing their
strengths and working to minimize their weaknesses.

 Analyze the Result for Future Development

This is a very important and final step in the process of entrepreneurship development. After the program
has run its course, it is very important to analyze the effectiveness of the program. This is necessary to
ensure that in future more effective programs can be developed. For this one has to minimize the
shortcomings of the existing program.

Meaning of Entrepreneur:

An entrepreneur supplies risk capital as a risk taker, and monitors and controls the business activities.
The entrepreneur is usually a sole proprietor, a partner, or the one who owns the majority of shares in an
incorporated venture.

In other words an entrepreneur is an individual who, rather than working as an employee, founds and
runs a small business, assuming all the risks and rewards of the venture. The entrepreneur is commonly
seen as an innovator, a source of new ideas, goods, services and business/or procedures.

According to economist Joseph Alois Schumpeter (1883-1950), entrepreneurs are not necessarily
motivated by profit but regard it as a standard for measuring achievement or success.

Someone who exercises initiative by organizing a venture to take benefit of an opportunity and, as the
decision maker, decides what, how, and how much of a good or service will be produced.

Meaning of Entrepreneurship:

The capacity and willingness to develop, organize and manage a business venture along with any of its
risks in order to make a profit. The most obvious example of entrepreneurship is the starting of new
businesses.
In economics, entrepreneurship combined with land, labor, natural resources and capital can produce
profit. Entrepreneurial spirit is characterized by innovation and risk-taking, and is an essential part of a
nation's ability to succeed in an ever changing and increasingly competitive global marketplace.
In other words Entrepreneurship is the process of designing, launching and running a new business,
which is often initially a small business. The people who create these businesses are called
entrepreneurs. The entrepreneur is able to recognize the commercial potential of the invention and
organize the capital, talent, and other resources that turn an invention into a commercially viable
innovation.

Meaning of enterprise

An  organization, especially a business, or a difficult and important plan, especially one that

will earn money.

Enterprise is another word for a for-profit business or company, but it is most often associated with
entrepreneurial ventures. People who have entrepreneurial success are often referred to as
“enterprising.”

There are many forms of legal enterprises, with the most common in the U.S. being:

 Sole proprietorship – A company run by a single individual, typically for their benefit, with
unlimited liability for any damages that occur as a result of the business’ operations.
 Partnership – A business run by two or more individuals or entities who share ownership – not
necessarily equal ownership, however.
 Corporation – A for-profit entity created to shield the owner(s) from liability should the
enterprise become subject to a lawsuit. There are different forms of corporations, depending on
how many owners there are.
 Limited Liability Company (LLC) – An LLC offers the legal protection of a corporation and the
tax treatment of a partnership.
 Professional Company/Professional Limited Liability Company (PC/PLLC) – PCs and PLLCs
are for licensed professional firms, such as accountants, architects, engineers, doctors, and
lawyers, and provide liability protection similar to a corporation

Characteristics of Entrepreneurship:

1. Economic and dynamic activity:

Entrepreneurship is an economic activity because it involves the creation and operation of an enterprise
with a view to creating value or wealth by ensuring optimum utilisation of scarce resources. Since this
value creation activity is performed continuously in the midst of uncertain business environment,
therefore, entrepreneurship is regarded as a dynamic force.

2. Related to innovation:

Entrepreneurship involves a continuous search for new ideas. Entrepreneurship compels an individual to
continuously evaluate the existing modes of business operations so that more efficient and effective
systems can be evolved and adopted. In other words, entrepreneurship is a continuous effort for synergy
(optimization of performance) in organizations.
 3. Profit potential:

“Profit potential is the likely level of return or compensation to the entrepreneur for taking on the risk of
developing an idea into an actual business venture.” Without profit potential, the efforts of entrepreneurs
would remain only an abstract and a theoretical leisure activity.

4. Risk bearing:

The essence of entrepreneurship is the ‘willingness to assume risk’ arising out of the creation and
implementation of new ideas. New ideas are always tentative and their results may not be instantaneous
and positive.

An entrepreneur has to have patience to see his efforts bear fruit. In the intervening period (time gap
between the conception and implementation of an idea and its results), an entrepreneur has to assume
risk. If an entrepreneur does not have the willingness to assume risk, entrepreneurship would never
succeed.

Importance of Entrepreneurship:

Benefits of Entrepreneurship to an Organization:

1. Development of managerial capabilities:

The biggest significance of entrepreneurship lies in the fact that it helps in identifying and developing
managerial capabilities of entrepreneurs. An entrepreneur studies a problem, identifies its alternatives,
compares the alternatives in terms of cost and benefits implications, and finally chooses the best
alternative.

This exercise helps in sharpening the decision making skills of an entrepreneur. Besides, these
managerial capabilities are used by entrepreneurs in creating new technologies and products in place of
older technologies and products resulting in higher performance.

2. Creation of organisations:

Entrepreneurship results into creation of organizations when entrepreneurs assemble and coordinate
physical, human and financial resources and direct them towards achievement of objectives through
managerial skills.

3. Improving standards of living:

By creating productive organizations, entrepreneurship helps in making a wide variety of goods and
services available to the society which results into higher standards of living for the people.

Possession of luxury cars, computers, mobile phones, rapid growth of shopping malls, etc. are pointers
to the rising living standards of people, and all this is due to the efforts of entrepreneurs.

4. Means of economic development:

Entrepreneurship involves creation and use of innovative ideas, maximisation of output from given
resources, development of managerial skills, etc., and all these factors are so essential for the economic
development of a country

Types of Entrepreneur

Entrepreneurs are classified into different types based on different classifications as mentioned below:

A. Based on the Type of Business:

1. Trading Entrepreneur:

As the name itself suggests, the trading entrepreneur undertake the trading activities. They procure the
finished products from the manufacturers and sell these to the customers directly or through a retailer.
These serve as the middlemen as wholesalers, dealers, and retailers between the manufacturers and
customers.

2. Manufacturing Entrepreneur:

The manufacturing entrepreneurs manufacture products. They identify the needs of the customers and,
then, explore the resources and technology to be used to manufacture the products to satisfy the
customers’ needs. In other words, the manufacturing entrepreneurs convert raw materials into finished
products.

3. Agricultural Entrepreneur:

The entrepreneurs who undertake agricultural pursuits are called agricultural entrepreneurs. They cover
a wide spectrum of agricultural activities like cultivation, marketing of agricultural produce, irrigation,
mechanization, and technology.

B. Based on the Use of Technology:

1. Technical Entrepreneur:

The entrepreneurs who establish and run science and technology-based industries are called ‘technical
entrepreneurs.’ Speaking alternatively, these are the entrepreneurs who make use of science and
technology in their enterprises. Expectedly, they use new and innovative methods of production in their
enterprises.

2. Non-Technical Entrepreneur:

Based on the use of technology, the entrepreneurs who are not technical entrepreneurs are non-technical
entrepreneurs. The forte of their enterprises is not science and technology. They are concerned with the
use of alternative and imitative methods of marketing and distribution strategies to make their business
survive and thrive in the competitive market.

C. Based on Ownership:
1. Private Entrepreneur:
A private entrepreneur is one who as an individual sets up a business enterprise. He / she it’s the sole
owner of the enterprise and bears the entire risk involved in it.

2. State Entrepreneur:

When the trading or industrial venture is undertaken by the State or the Government, it is called ‘state
entrepreneur.’

3. Joint Entrepreneurs:

When a private entrepreneur and the Government jointly run a business enterprise, it is called ‘joint
entrepreneurs.’

D. Based on Gender:
1. Men Entrepreneurs:

When business enterprises are owned, managed, and controlled by men, these are called ‘men
entrepreneurs.’

2. Women Entrepreneurs:

Women entrepreneurs are defined as the enterprises owned and controlled by a woman or women
having a minimum financial interest of 51 per cent of the capital and giving at least 51 per cent of
employment generated in the enterprises to women.

E. Based on the Size of Enterprise:

1. Small-Scale Entrepreneur:

An entrepreneur who has made investment in plant and machinery up to Rs 1.00 crore is called ‘small-
scale entrepreneur.’

2. Medium-Scale Entrepreneur:

The entrepreneur who has made investment in plant and machinery above Rs 1.00 crore but below Rs
5.00 crore is called ‘medium-scale entrepreneur.’

3. Large-Scale entrepreneur:

: The entrepreneur who has made investment in plant and machinery more than Rs 5.00 crore is called
‘large-scale entrepreneur.’ Based on Clarence Danhof Classification:

Clarence Danhof (1949), on the basis of his study of the American Agriculture, classified entrepreneurs
in the manner that at the initial stage of economic development, entrepreneurs have less initiative and
drive and as economic development proceeds, they become more innovating and enthusiastic.

Based on this, he classified entrepreneurs into four types:

These are discussed in seriatim:

 1. Innovating Entrepreneurs:

Innovating entrepreneurs are one who introduce new goods, inaugurate new method of production,
discover new market and reorganize the enterprise. It is important to note that such entrepreneurs can
work only when a certain level of development is already achieved, and people look forward to change
and improvement.

2. Imitative Entrepreneurs:

These are characterized by readiness to adopt successful innovations inaugurated by innovating

entrepreneurs. Imitative entrepreneurs do not innovate the changes themselves, they only imitate
techniques and technology innovated by others. Such types of entrepreneurs are particularly suitable for
the underdeveloped regions for bringing a mushroom drive of imitation of new combinations of factors
of production already available in developed regions.

3. Fabians Entrepreneurs:

Fabians entrepreneurs are characterized by very great caution and skepticism in experimenting any
change in their enterprises. They imitate only when it becomes perfectly clear that failure to do so would
result in a loss of the relative position in the enterprise.

4. Drone Entrepreneurs:

These are characterized by a refusal to adopt opportunities to make changes in production formulae even
at the cost of severely reduced returns relative to other like producers. Such entrepreneurs may even
suffer from losses but they are not ready to make changes in their existing production methods.

Following are some more types of entrepreneurs listed by some other behavioural scientists:

1. Solo Operators:

These are the entrepreneurs who essentially work alone and, if needed at all, employ a few employees.
In the beginning, most of the entrepreneurs start their enterprises like them.

2. Active Partners:

Active partners are those entrepreneurs who start/ carry on an enterprise as a joint venture. It is
important that all of them actively participate in the operations of the business. Entrepreneurs who only
contribute funds to the enterprise but do not actively participate in business activity are called simply
‘partners’.

3. Inventors:

Such entrepreneurs with their competence and inventiveness invent new products. Their basic interest
lies in research and innovative activities.

4. Challengers:
These are the entrepreneurs who plunge into industry because of the challenges it presents. When one
challenge seems to be met, they begin to look for new challenges.

5. Buyers:

These are those entrepreneurs who do not like to bear much risk. Hence, in order to reduce risk involved
in setting up a new enterprise, they like to buy the ongoing one.

6. Life-Timers:

These entrepreneurs take business as an integral part to their life. Usually, the family enterprise and
businesses which mainly depend on exercise of personal skill fall in this type/category of entrepreneurs.

Role and functions of entrepreneur in relation to the economy:

Entrepreneurship plays an influential role in the economic growth and standard of living of the country.
As a startup founder or small business owner, you may think that you are simply working hard to build
your own business and provide for yourself and your family. But you are actually doing a whole lot
more for your local community, state, region, and the country as a whole. Here are the top 7 important
roles an entrepreneur plays in the economic development of a country.

 Wealth Creation and Sharing: By establishing the business entity, entrepreneurs invest their own
resources and attract capital (in the form of debt, equity, etc.) from investors, lenders and the
public. This mobilizes public wealth and allows people to benefit from the success of
entrepreneurs and growing businesses. This kind of pooled capital that results in wealth creation
and distribution is one of the basic imperatives and goals of economic development.

 Create Jobs: Entrepreneurs are by nature and definition job creators, as opposed to job seekers.
The simple translation is that when you become an entrepreneur, there is one less job seeker in
the economy, and then you provide employment for multiple other job seekers. This kind of job
creation by new and existing businesses is again is one of the basic goals of economic
development. This is why the Govt. of India has launched initiatives such as StartupIndia to
promote and support new start-ups, and also others like the Make in India initiative to attract
foreign companies and their FDI into the Indian economy. All this in turn creates a lot of job
opportunities, and is helping in augmenting our standards to a global level.

 Balanced Regional Development: Entrepreneurs setting up new businesses and industrial units

help with regional development by locating in less developed and backward areas. The growth of
industries and business in these areas leads to infrastructure improvements like better roads and
rail links, airports, stable electricity and water supply, schools, hospitals, shopping malls and
other public and private services that would not otherwise be available.
Every new business that locates in a less developed area will create both direct and indirect jobs,
helping lift regional economies in many different ways. The combined spending by all the new
employees of the new businesses and the supporting jobs in other businesses adds to the local
 and regional economic output. Both central and state governments promote this kind of regional
development by providing registered MSME businesses various benefits and concessions.

 GDP and Per Capita Income: India’s MSME sector, comprised of 36 million units that provide
employment for more than 80 million people, now accounts for over 37% of the country’s GDP.
Each new addition to these 36 million units makes use of even more resources like land, labor
and capital to develop products and services that add to the national income, national product
and per capita income of the country. This growth in GDP and per capita income is again one of
the essential goals of economic development.

 Standard of Living: Increase in the standard of living of people in a community is yet another

key goal of economic development. Entrepreneurs again play a key role in increasing the
standard of living in a community. They do this not just by creating jobs, but also by developing
and adopting innovations that lead to improvements in the quality of life of their employees,
customers, and other stakeholders in the community. For example, automation that reduces
production costs and enables faster production will make a business unit more productive, while
also providing its customers with the same goods at lower prices.

 Exports: Any growing business will eventually want to get started with exports to expand their
business to foreign markets. This is an important ingredient of economic development since it
provides access to bigger markets, and leads to currency inflows and access to the latest cutting-
edge technologies and processes being used in more developed foreign markets. Another key
benefit is that this expansion that leads to more stable business revenue during economic
downturns in the local economy.  

 Community Development: Economic development doesn’t always translate into community

development. Community development requires infrastructure for education and training,
healthcare, and other public services. For example, you need highly educated and skilled workers
in a community to attract new businesses. If there are educational institutions, technical training
schools and internship opportunities, that will help build the pool of educated and skilled
workers.

A good example of how this kind of community development can be promoted is Azim Hashim
Premji, Chairman of Wipro Limited, who donated Rs. 27,514 crores for promoting education
through the Azim Premji Foundation. This foundation works with more than 350,000 schools in
eight states across India.

So, there is a very important role for entrepreneurs to spark economic development by starting new
businesses, creating jobs, and contributing to improvement in various key goals such as GDP, exports,
standard of living, skills development and community development.
Functions of Entrepreneurs in the Economy

In layman’s terms, an economy can be defined as a general area of production, distribution, trade and
consumption. It follows a simple rule of demand and supply. Whatever the consumers need and demand is
produced and supplied by the producers in the economy.

As soon as a need is recognized in the society, an entrepreneur comes into action to efficiently and
profitably satisfy these needs. Let us see some important functions an entrepreneur fulfils in the economy.

 Contribution to the GDP

GDP refers to the monetary value of all final goods and services produced in an economy during a specified
period of time- usually a year. These goods and services are provided by the entrepreneurs of that particular
economy

In a fast-growing economy like India, the entrepreneurs play a vital role in producing the optimum amount
of products and services in response to the demand by the people. If there were no entrepreneurs, the
country would be solely dependent on the imports and multinational companies and the GDP would be
adversely affected or collapse. Therefore, the economy is hugely dependent on the entrepreneurs for its
GDP generation.

 Foreign Exchange Earnings

Industries like the handloom and many other industries produce goods not only to meet the domestic
requirements but also export these goods and earn valuable foreign exchange for the country. This adds to
the economic growth of the country.

 Generates Employment
Starting new ventures inevitably means the requirement of various resources including the very valuable
human resource to get the work done. People are required to perform various functions in an organization.
So one of the major functions of entrepreneurs is helping the economy by generating employment.

 Tax Generation
More employment to the people also results in more taxable income for the government. This helps the
government increase their tax revenues that which they use for the development of the country and improve
the standard of living of the people.

 Eradicating Poverty
India is a labor intensive economy because of the vast population in the country. And since entrepreneurs
help in generating employment, they directly help the government in eradicating unemployment and
poverty in the economy. More income means that people are able to afford more and better things.
  Entrepreneurs Introduce New Technology
Since a long time, entrepreneurs have been introducing new technologies in the economy. For example,
Steve jobs introduced the MAC software. Such technological advancements help to develop the economy
as a whole. This is one of the reasons that the government supports and promotes the entrepreneurs

 Entrepreneurs help other Industries in the Economy

A lot of industries use the products of other industries as a raw material for their finished products, thus
generating even more goods and services as well as more revenue.

For example, while flour is a finished product for a person who owns a flour mill, it is a raw material for the
factory producing biscuits. In this way, it goes on and on. One idea or product leads to the development of
another or complementary product or service.

 Specific Tax Revenue

Entrepreneurs pay various direct and corporate taxes to the state governments without which they cannot
function in the states. Therefore, the entrepreneurs help in additional tax revenue generated in the country.

 Bringing in FDI
A lot of start-ups are funded by various companies in foreign countries. This helps the economy bring in
more and more foreign investments. In fact, RBI helps these start-ups by relaxing policies on FDI.

Difference between Entrepreneur and Intrapreneur.

The main difference between Entrepreneur and Intrapreneur is that Intrapreneur is an employee, and
Entrepreneur is free and the leader of the operation.
Intrapreneurship is the change initiatives taken within a going concern by the people working in that
organization.
Hisrich and Peters define. “Intrapreneurship is the entrepreneurship within an existing organization”.
Intrapreneurship is the entrepreneurship within the organization undertaken by the working people for
making the organization competitive and sustainable in the present market and open
economy Entrepreneurship and Intrapreneurship sound similar but they have got the difference in their
meaning and significance.
In this context, we can show the differences between these two concepts in the following bifurcated
manner;

Differences between Entrepreneurship and Intrapreneurship

Points of difference Intrapreneurship Entrepreneurship

Definition Intrapreneurship is the Entrepreneurship is the dynamic

entrepreneurship within an existing process of creating incremental wealth.
organization.
Core objective To increase competitive strength and To innovate something new of socio-
market sustainability of the economic value.
organization.

Primary motives Enhance the rewarding capacity of the Innovation, financial gain tad
organization and autonomy. independence.

Activity Direct participation, which is more Direct and total participation in the
than a delegation of authority. process of innovation. _

Risk Hears moderate risk. Bears all types of risk.

Status Organizational employee expecting The free and sovereign person doesn’t
freedom in work. bother with status.

Failure and mistakes Keep risky projects secret unless it is Recognizes mistake and failures so as
prepared due to high concern for to take new innovative efforts.
failure and mistakes.

Decisions Collaborative decisions to execute Independent decisions to execute

dreams. dreams.

Whom serves Organization and intrapreneur himself.Customers and entrepreneur himself.

Family heritage May not have or a little professional Professional or small business family
post. heritage.

Relationship with othersAuthority structure delineates the A basic relationship based on

relation. interaction and negotiation.

Time orientation Self-imposed or organizationally There is no time bound.

stipulated time limits.

The focus of attention on Technology and market. Increasing sales and sustaining
competition.

Attitude towards Follows self-style beyond given Adaptive self-style considering

destiny structure. Structure as inhabitants.

Attitude towards Strong self-confidence and hope for Strong commitment to self-initiated
destiny achieving goals. efforts and goals.
Operation Operates from inside the organization. Operates from outside the
organization.

Difference Between Entrepreneur and Entrepreneurship

An entrepreneur is someone who locates the need of society and tries to meet the same, with his/her
innovative idea. On the other hand, ‘entrepreneurship’ which refers to the process of establishing a
business entity, intending to get profit, as a return in the future.

BASIS FOR
ENTREPRENEUR ENTREPRENEURSHIP
COMPARISON

Meaning An entrepreneur is an Entrepreneurship is a risky activity

individual or a team of commencing a business usually a
thereof, having an start up company, offering distinct
innovative idea, and takes products and services to the target
every step to turn the idea customers, which may or may not
into reality, while bearing get success.
the risks.

What is it? Person who has an idea and Process which gives shape to the
gives shape to it. idea.

Represents An innovator, who chased A procedure through which an

the dream, till it becomes innovation is done.
true.

Business Venture He/She is the one who sets It is the activity, which an
up the business venture, to entrepreneur undertakes to set up
turn a concept into reality. the business venture.

The company formed by an entrepreneur is usually a startup enterprise, which can be understood as the
live manifestation of his/her idea. So, an entrepreneur is:

 A beginner in the market, who has something new to offer to society and starts right from
scratch to establish and run the enterprise.
 An innovator, who has a thought-provoking idea or concept in his/her mind, that has the
capability to lead the marketplace.
 A developer, who develops a business model, to give shape to the idea.
 A leader, who provides guidance and support to his/her men, to work in a specific direction or
change the same (if required) so as to achieve the target.
  An incharge who is accountable and responsible for the success or failure of the venture, for the
decisions made by him/her.
 A promoter, who takes all the relevant steps to turn the dream into reality.
 A forecaster, who foresees, future opportunities and threats which can affect the venture,
positively or negatively.
 A risk-taker, who has the ability to anticipate the risk in the future moves, and take the risk, if
they are beneficial to the enterprise.

Definition of Entrepreneurship

Entrepreneurship is the process or activity, of initiating, developing, managing and operating a startup
company, while taking all the risks involved, so as to make profits. It is one of the four factors of
production, the other being land, labor, capital. 

Characteristics of Entrepreneurship

 Process: Entrepreneurship is a systematic, purposeful, creative and continuous process, which an

entrepreneur undertakes to run the business smoothly.
 Innovation: Innovation is the key feature of the entrepreneurship, which creates a difference in
the market place. Indeed, it helps the enterprise to introduce the product quickly, as there is
hardly any company which is selling the product in the market.
 Development of network: Developing strong connections with the parties such as suppliers,
distributors, banks, debtors, creditors and many more, which are directly or indirectly related
with the business process, to have a good worth, in the market.
 Profit potential: Profit is something, that keeps the organization going, in fact, it acts as a
motivation for the entrepreneur, to do better than before. So, before taking any decision
regarding the enterprise, priority is given to the profit potential, i.e. while taking any step further,
the entrepreneur identifies whether it is profitable or not.
 Forecasting of Market Trends and future possibilities: The entrepreneur has to keep a close
watch on the market trends and future demands so that the enterprise could continuously work to
improve the products or services offered, and grow further.
 Risk Assumption: You might have heard the famous saying “no risk, no gain”, which means
that the profit of business depends on the risk factor. So, risks and rewards are inherent to the
enterprise; in fact, there is hardly any business which survives without taking any risks.
Key Differences between Entrepreneur and Entrepreneurship

The difference between entrepreneur and entrepreneurship are discussed in the points given below:

1. An entrepreneur is a person, or a team of individuals, having a vision, which not just generates
money, but can also ease the way in which things are done, by providing such products and
services that has value to the customer, while taking all the risks, which comes in the way.
Conversely, entrepreneurship is an art of turning an idea into reality, which is not only about
arranging the resources to give shape to the idea but constantly making efforts in that direction,
to earn profit in future and bearing all the risks or rewards.
2. An entrepreneur is just a person having a unique and practical idea in his/her mind. As against,
entrepreneurship is the process of starting and running a business of providing creative products
and services.
3. An entrepreneur is an innovator, as he/she conceives an innovative idea, which is not yet
introduced by anyone else in the market. On the contrary, entrepreneurship is the way through
which one can make innovations.
4. An entrepreneur establishes the business venture, in order to convert the idea, into a product or
service, which can help many by easing the way work is performed previously. In contrast,
entrepreneurship is all about undertaking the business and bearing all the risks that come in the
way, to give a proper shape to the entrepreneur’s vision.
Conclusion

With the above discussion, it might be clear that that entrepreneur is just a person with a billion dollar
idea, who has the ability and willingness to give shape to that idea, by going through the
entrepreneurship process. An entrepreneur is known for their decisions, which decides the destiny of the
enterprise.
Entrepreneurial culture

An Entrepreneurial Organizational Culture (EOC) is a system of shared values, beliefs and norms of
members of an organization, including valuing creativity and tolerance of creative people, believing that
innovating and seizing market opportunities are appropriate behaviors to deal with problems of survival
and prosperity, environmental uncertainty and competitors' threats and expecting organizational
members to behave accordingly.
Fostering an Entrepreneurial Culture within Organization
an organizational culture does not grow on its own. It must be nurtured. An organization's culture must
be deliberately cultivated through concerted action including modeling, structure, constant
communication, and positive reinforcement.
 Leading an Entrepreneurial Culture

People take their cue from their leaders. Their values, priorities, and actions are guided by what their
superiors model. It sounds simple, but it's true. The senior executives set the tone for what the company
should be doing, what the organizational values should be, and how people should act. From a business
leader's perspective, that's the starting point of driving an entrepreneurial culture - embrace it and model
it. Talk about it, reward, and encourage it. An over-authoritarian workplace discourages people from
using their own initiative and stifles traits that enhance innovation and productivity. An overly
democratic environment lacks focus to keep the company moving toward its goals. Successful
companies ensure their executive teams constantly demonstrate their value, productivity, and the open
flow of ideas.
 Create an Environment of Empowerment

A big part of driving an entrepreneurial culture is creating the environment where people can act like
entrepreneurs. We're not saying empower people. We're saying foster the environment where people
empower themselves. To act entrepreneurially, people must feel empowered to take the lead and create
positive change. 
To make this happen, follow these key points:

 Learn each individual's strengths, then play to them

 Give power to those people who have demonstrated they are ready for more responsibility
 Give people discretion of their own decisions and resources
 Provide opportunities for training and education to help people grow
 Don't second guess people
 Reward people for tackling problems and advancing the company's interests

 Communicate

Communicate. Communicate. Communicate. It's a fundamental function of leadership. However, many

leaders get so bogged down in the day-to-day tasks that they forget to tell people where they are going.
Constantly remind your people about the vision and direction. When it comes to communication, people
want to feel like they are getting the important information. They also want to hear that their concerns
and ideas are being heard. Create an open environment by:
  Sharing information freely
 Making sure information flows up and down
 Encouraging people to openly ask questions about how to makes things better

These communication practices are also key to creating an empowering environment.

 Value the Entrepreneurial Approach

Communicate with your people about the values - those guiding principles that support every decision
the company makes. Let them know that an entrepreneurial approach is valued, encouraged, and
rewarded. Remember that a company's values don't need to be complicated or even original. The
important point is that they are sincere.
 Continuous Effort

Fostering an entrepreneurial culture requires continuous effort. Make sure your entrepreneurial vision is
part of your senior management discussions. It should also be a topic for managers' performance
discussions with their teams. Again, the entrepreneurial culture must be cultivated. It is the result of a
concerted effort by the company to drive innovation, productivity, and success.

Concepts of women entrepreneur

Women entrepreneur may be defined as a woman or group of women who initiate, organize, and run a
business enterprise. In terms of Schumpeterian concept of innovative entrepreneurs, women who
innovate, imitate or adopt a business activity are called “women entrepreneurs”.
The Government of India has defined women entrepreneurs based on women participation in equity and
employment of a business enterprise. Accordingly, the Government of India (GOI2006) has defined
women entrepreneur as “an enterprise owned and controlled by a women having a minimum financial
interest of 51 per cent of the capital and giving at least 51 per cent of the employment generated in the
enterprise to women.” However, this definition is subject to criticism mainly on the condition of
employing more than 50 per cent women workers in the enterprises owned and run by the women.
Challenges and problems faced by women entrepreneurs in India

1. Family restriction
Women are expected to spend more time with their family members. They do not encourage women to
travel extensively for exploiting business opportunities.

2. Lack of Finance
Family members do not encourage women entrepreneurs. They hesitate to invest money in the business
venture initiated by women entrepreneurs. Bank and other Financial Institutions do not consider Middle
Class Women Entrepreneurs as proper applicants for setting up their projects and they are hesitant to
provide financial assistance to unmarried women or girls as they are unsure as to who will repay the
loan — Either their parents or in-laws after their marriage. This humiliates unmarried women and they
generally leave the idea of setting up their ventures.

For example, Kiran Mazumdar Shaw initially faced many problems regarding funds for her business.
Banks were hesitant to give loan to her as biotechnology was a totally new field at that point of time and
she was a woman entrepreneur, which was a rare phenomenon.
 3. Lack of Education
Women are generally denied of higher education, especially in rural areas and under developed
countries. Women are not allowed to enrich their knowledge in technical and research areas to introduce
new products.

4. Role Conflict
Marriage and family life are given more importance than career and social life in Indian society.

5. Unfavorable Environment
The society is dominated by males. Many business men are not interested to have business relationship
with women entrepreneurs. Male generally do not encourage women entrepreneurs.

6. Lack of persistent Nature

Women generally have sympathy for others. They are very emotional. This nature should not allow
them to get easily cheated in business.

7. Lack of Mental strength

Business involves risk. Women entrepreneurs get upset very easily when loss arises in business.

8. Lack of Information
Women entrepreneurs are not generally aware of the subsidies and incentives available for them. Lack
of knowledge may prevent them from availing the special schemes.

9. Stiff Competition
Women face lot of competition from men. Due to limited mobility they find difficult to compete with
men.

10. Mobility
Moving in and around the market, is again a tough job for Middle Class Women Entrepreneurs in Indian
Social system.

Remedial measures.

Some of the remedial measures that can be undertaken to promote women entrepreneurship in India, are
as follows.

o Promotional Help
Government and NGOs must provide assistance to entrepreneurs, both in financial and non financial
areas.

o Training
Women entrepreneurs must be given training to operate and run a business successfully. Training has to
be given to women who are still reluctant to take up the entrepreneurial task.

o Selection of Machinery and Technology

Women require assistance in selection of machinery and technology. Assistance must be provided to
them in technical areas so that the business unit become successful.
 o Finance
Finance is one of the major problems faced by women entrepreneurs. Both family and government
organizations should be liberal in providing financial assistance to them.

o Marketing Assistance
Due to limited mobility, women are unable to market their goods. Assistance must be provided to help
them to market their goods successfully in the economic environment.

o Family support
Family should support women entrepreneurs and encourage them to establish and run business
successfully.

Types of women Entrepreneurs

Women entrepreneurs in India are broadly divided into the following categories:

 Affluent Entrepreneurs:

Affluent women entrepreneurs are those women entrepreneurs who hails from rich business families.
They are the daughters, daughter-in laws, sisters, sister-in-laws and wives of affluent people in the
society. Many of them are engaged in beauty parlour, interior decoration, book publishing, film
distribution and the like. The family supports the above type of entrepreneur in carrying out their
responsibilities.

 Pull Factors:

Women in towns and cities take up entrepreneurship as a challenge to do something new and to be
economically independent. These are coming under the category of pull factors. They belong to
educated women who generally lake up small and medium industries where risk is low. Under this
category, women usually start service centres schools, food catering centres, restaurants, grocery shops
etc.

 Push Factors:

There are some women entrepreneurs who accepts entrepreneurial activities to overcome financial
difficulties. The family situation forces them either to develop the existing family business or to start
new ventures to improve the economic conditions of the family. Such categories of entrepreneurs are
termed as push factors.

 Self-employed Entrepreneur:

Poor and very poor women in villages and town rely heavily on their own efforts for sustenance. They
start tiny and Small enterprises like brooms making, wax candle making, providing tea and coffee to
offices, ironing of clothes knitting work, tailoring firm etc. Such women are called self-employed
entrepreneurs.

 Rural Entrepreneurs:
Women in rural areas/villages start enterprises which needs least organizing skill and less risk. Dairy
products, pickles, fruit juices, pappads and jagger making are coming under this category of Rural
entrepreneur.

UNIT 2